Suncorp reaches final stages of its three-year plan

Suncorp Group is nearing the final stages of implementing a three-year strategic plan, while digital efforts in its insurance arm are helping mitigate inflation costs.

The group's half-year 2023 results showed a net profit after tax up 44.3 percent to $560 million, while its cash earnings were up 62.9 percent to $588 million.

Meanwhile, Suncorp Bank’s profit after tax increased 28 percent to $256 million, driven by solid volume growth and higher margins.

Suncorp Group CEO Steve Johnston said the results “confirm the underlying momentum we have across all of our businesses and it proves the FY23 plan is delivering”.

In its half-year 2023 results, Suncorp Group said its strategy and FY23 plan have reached the last delivery stages despite working against numerous global events such as La Niña, inflation, the pandemic and disrupted supply chains.

Its FY23 plan, first unveiled to its board in 2020 and then first outlined to the market in February 2021, consist of 12 key initiatives aimed at “improving the way we deliver insurance and banking products for our customers”.

Johnston said despite challenges its “businesses emerged in great shape, and we remain confident in achieving those FY23 targets” of improved financial performance.

“Over the plan period, growth momentum has continued to build as our efforts to reinvigorate our brands, to refine our customer value propositions, to improve their marketing and simplify our product portfolio have taken effect," he said.

“Our pricing engine, CaPE, has been rolled out in Australia to our mass brands across our home portfolio".

Deployment of CaPE is now underway in motor vehicle insurance.

He added the first phase of its new SME broker platform has now been rolled out, providing “enhanced pricing and risk selection, improving the broker experience for new business and will assist us in our ongoing remediation of the packages business.”

According to the business, its FY23 plans have also delivered a boost to digital sales and service transactions, and streamlined the digital purchasing processes using geospatial imagery and artificial intelligence.

“We continue to focus on making digital purchasing easier through our use of geospatial imagery, artificial intelligence and removing barriers to online cell service, to meet customers increased appetite to interact with us online,” Johnston said.

“The strategic initiatives that we have delivered and that we continue to deliver set the group up well for our future particularly as we emerge as a pure play insurance.”

Johnston said its digital best-in-class claim program “has really delivered” with the “digitisation of our claims processes, the reach and depth of our building panel, and our enhanced disaster response capabilities” playing a crucial role in the “operating resilience that we need to manage a changing climate.”

ANZ Banking Group sale

Johnston said the sale of Suncorp Bank to ANZ Banking Group remains on track with the ACCC expected to announce its determination by June this year.

“The first step in the approvals process with the sale is also subject to approval from the Queensland government and the federal treasurer."

He said Suncorp will “continue to work constructively with ANZ and the relevant regulatory and government authorities” while remaining “intensely focused” on its bank strategy and FY23 plan.

Johnston added the group will continue to provide updates on the progress of the transaction.

“We will also look to provide more information on the shape of Suncorp as we emerge as a pure-play insurance company.”